SAN FRANCISCO -- The housing slump is starting to make things messy at Bed Bath & Beyond ( BBBY). Shares slid as much as 11% Friday, though they recently recovered some ground, after the home-products retailer projected fourth-quarter earnings well below Wall Street's targets. As well, the company's third-quarter report showed a drop in margins for the period, and only a slight increase in its same-store sales, or sales at stores open at least a year. While Bed Bath & Beyond shares have taken hits over the past year as investors fear the ramifications of the housing slump, the lackluster outlook from the historically strong company was jarring. The weakness caused some to wonder if even stellar performers can sidestep the country's larger economic woes much longer. David Strasser, an analyst for Banc of America Securities, said that although Bed Bath & Beyond is managing its business as well as can be expected, there is still plenty of reason to be concerned about 2008, especially in light of the long-lasting weakness seen among Home Depot ( HD), Lowe's ( LOW) and other housing-related retailers whose sales and earnings rapidly disintegrated once the slowdown began. "A difficult housing market seems to have fully caught up with the company," Strasser wrote of Bed Bath & Beyond in his research. He added that Bed Bath & Beyond's performance is also an indication of slower spending by midtier consumers, a factor that has also hurt discount chain Target ( TGT). Last week, Target -- also a former outperformer -- slashed its projections for December same-store sales.